Bank of America Pushed Down Financial Stocks
Shares in Bank of America (NYSE:BAC) drew the attention of Wall Street on Monday as the company’s stock came close to $10 per share for the first time since March. Initially leading the financial stocks lower, Bank of America rallied from its early-morning drop of one percent, reaching $9.10.
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Recently, Bank of America made its plans known: an internal documented distributed to top management last year detailed Project New BAC as means for the company to take less risk, generate more revenue from its existing customers, and save $8 billion by mid-2015.
Online publication, Seeking Alpha blames current management for the bank’s low Accounting and Governance Risk rating; Bank of America’s most recent financial data gave it an AGR score higher than 92 percent of comparable companies. Bank of America’s “comparable companies,” Wells Fargo (NYSE:WFC), JPMorgan Chase (NYSE:JPM), and Citigroup (NYSE:C), all have stock prices ranging from $30 to $40 per share.
Bank of America’s 4.6 percent return on equity, 14 percent operating margin, and 11.6 percent profit margin are the lowest among all of these banks.
“The management’s poor corporate governance puts Bank of America at high risk of experiencing regulatory problems, which continue unabated,” wrote the publication in its most recent analysis of the company dated September 24.
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